Newzoo’s Trends to Watch in 2019

The past year has seen plenty of exciting developments across games, esports, and mobile. Naturally, many of these trends will spill into 2019 and beyond. But there will also be plenty of new, disruptive, and surprising developments across these industries. Following from our continuous and extensive market analysis, we put together a list of which trends to look out for in 2019—for games, esports, and mobile. Keep reading to learn what we anticipate for the next 12 months!

Games

The Market Will Continue to Grow

In 2019, the global games market will generate revenues just short of $150 billion. Mobile game revenues will again grow significantly, mostly driven by emerging markets like India. Meanwhile, console will also have another strong year.

Yet, fewer game releases in China, the world’s largest and most lucrative games market, will limit its growth potential. Toward the end of 2019, anticipation for next-generation games consoles will result in a temporary slowdown of revenue growth.

A Relatively Quiet Year for Sony and Microsoft

Despite a few large releases, including The Last of Us Part II and Gears 5, Sony and Microsoft will have a relatively quiet year in 2019. This is mostly due to both companies gearing up for the next console generation. In 2020, we expect that Sony will host their own PlayStation event, announcing the PlayStation 5 for release.

Unlike Microsoft, Sony will not offer a cheaper console intended for cloud gaming in 2019 or 2020. Nintendo, on the other hand, will release a Nintendo Switch revision, adding features such as a higher-quality screen.

PC’s Store Wars Will Heat Up

On PC, Steam has had a monopoly on the digital game store market for over a decade. The tail end of 2018, however, saw increased competition from the likes of Epic Games and Discord, with the Epic Games Store and Discord Store, respectively. Epic leveraged its massive Fortnite audience to attract consumers, while also offering exclusivity deals and a better revenue split for developers wishing to add games to the store.

We expect the Epic Games Store to have strong growth next year, but third-party (timed) exclusivity deals will alienate the purist PC gamer crowd. Timed third-party exclusives are a new phenomenon within the PC store ecosystem, so this will be less of a problem for newer PC gamers who are used to exclusive titles on console. Discord recently announced an even-better revenue share for developers (90/10 split, in favor of devs) on the Discord Store.

China’s Regulations Will Change Developers’ Strategies at Home and Abroad

Following regulatory reform in China and the formation of the Ethics Game Committee, it will be difficult for publishers to release games in China. To adhere to the new committee’s standards, foreign companies must invest time and resources to adjust their titles. Of course, companies will only make these adjustments if they are confident that their games will perform well in China, meaning that only the biggest titles and franchises can risk Chinese releases.

The new regulations will also cause Chinese game companies to move their focus overseas. In particular, Southeast Asia, Japan, South Korea, Europe, the U.S., and the Middle East are high-potential markets.

Esports

Premium Passes Become More Popular

Premium content passes started emerging in 2018, giving fans the chance to pay extra for additional esports video content. Fans who purchased the Overwatch League All-Access Pass on Twitch, for example, got access to extra shoulder content. This included behind-the-scenes videos, post-match Q&A sessions with players, and multi-view streams—as well as in-game Overwatch content.

Znipe.tv also turned heads by partnering up with ESL, DreamHack, PGL, and Face It, offering a premium viewing experience currently unavailable in other platforms, including four streams/camera angles during matches. We will see plenty more premium passes appearing throughout 2019, as leagues and broadcasters continue to look to new monetization models.

More Esports Athletes Featured in Brands’ Marketing Campaigns

The ongoing growth of esports and its mainstream popularity will lead to more esports athletes being featured in national and international marketing campaigns in 2019. There were plenty of notable examples in 2018, with League of Legends star Uzi appearing alongside basketball legend LeBron James in Nike’s Chinese “Dribble &” campaign.

Similarly, Head & Shoulders released a commercial in Russia featuring RAMZES666, a Russian Dota 2 player. His Virtus.pro teammate Solo starred in a similar commercial for Gillette. Of course, Ninja, the world-famous Fortnite streamer appeared in a commercial for Samsung and was featured on the cover of ESPN Magazine.

Esports Venues on the Up

As esports’ popularity increases, bigger, better, and more venues will be necessary to cater to attendees. After all, the global esports audience will total 456 million in 2019—up from 2018’s 395 million. Leagues such as the Overwatch League and LoL Pro League will have their participating teams play in their own venues in the coming years, increasing the need for venues suitable for esports.

There are numerous esports arenas under construction, and many of these will open their doors in 2019. Some notable examples include: Riot Games’ LCK Esports Stadium in Seoul, South Korea; Full Sail University’s $6-million arena in Florida, which will be the world’s largest collegiate esports venue; and Canada’s first esports arena, based in Richmond. We expect plenty more venue announcements in the coming months.

Southeast Asia’s Esports Scene Continues to Take Off

Southeast Asia is 2019’s esports region to look out for. The region also boasts the fastest-growing esports audience, which will reach 31.9 million in 2019. In Q4 2018, Singtel Group and its regional partners agreed to collaborate to grow the gaming and esports ecosystem across Southeast Asia, Australia, and India. This will mean plenty of new esports developments in SEA going forward.

What’s more, competitive games (Dota 2, Starcraft 2, Tekken 7, and mobile titles Mobile Legends: Bang Bang, and Arena of Valor.) will be a medal sports at the 2019 Southeast Asian Games. In 2019, we expect to see numerous announcements for new leagues and tournaments in Southeast Asia.

Mobile

Epic Will Expand Its Store to Mobile

Epic has made its intention to compete with Steam on PC very clear. It is likely that the company will try a similar strategy on mobile (Android specifically) in 2019. Epic already decided to bypass the Google Play Store earlier this year, when it opted to release the Android edition of Fortnite via a dedicated proprietary launcher.

We expect the company to bring a dedicated launcher to mobile for its future games and perhaps other publishers’ titles—essentially, a mobile edition of the Epic Games Store. Epic has already showcased that it can effectively distribute mobile games on a large scale, and the company is building a rich set of tools for mobile and PC cross-platform development. This may be a sign of things to come. If Epic can attract mobile developers to a new platform using a developer-friendly revenue share, this would disrupt the app distribution scene and could mark the beginning of the end for app stores.

More Immersive and Competitive Games on Mobile

Over the past few years, smartphones have become powerful enough to match certain laptops in processing power—all while remaining small enough to put in your pocket. One result of this: genres that were once exclusive to PC/console—including shooters, MOBAs, and (MMO)RPGs—are now commonplace on mobile. In 2019, they will be even more common, with further releases of immersive and competitive mobile games.

These types of mobile games are, and will remain to be, very popular in emerging markets such as India and South East Asia. Drawn to the potential of these markets, Western publishers will continue to adapt popular franchises to the mobile games market, following the recent examples set by Fortnite and upcoming Activision-Blizzard title Diablo Immortal.

2019: Not the Year of 5G

It seems that every other smartphone news article these days mentions 5G. Despite this media hype, we expect that the technology will not truly kick off until 2020 or later. In 2019, only a select few cities will have access to 5G. At first, the difference between 4G and 5G will seem incremental, as 5G will need several more years of infrastructure investment and technological breakthroughs to deliver on its full promise.

5G will also be limited to a small number of high-end smartphone models. While Samsung, Google, Oppo, Huawei, and others have confirmed 5G-enabled smartphones for 2019, most consumers will not upgrade right away. Also, Apple won’t be adding 5G tech to its iPhones until at least 2020, further hindering 5G adoption.

Apple Will Enter the Video-Streaming Space

In 2019, Disney+ will join a long list of video-streaming services, including Netflix, Amazon Prime, Hulu, HBO NOW, and many more. The year could also see the addition of a similar service from another media giant: Apple. The company already offers services for music (Apple Music), payments (Apple Pay), and cloud storage (iCloud). Video will be the next step.

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